Construct · 1 fields · 3 citations

Porter's five forces: a standalone construct

One name. One construct. A landmark on the map.

● anchor · a standalone construct Nearest construct by meaningcompetitive advantagecompare the meanings
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Porter'sfive forces1 CONSTRUCTFive forcesPORTER · FIVE FORCES

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Strategy and management

A framework for analysing an industry's competitive structure through five forces

Michael E. Porter set out the five forces in his 1979 Harvard Business Review article "How Competitive Forces Shape Strategy" and developed them fully in his 1980 book Competitive Strategy. The framework holds that the profitability an industry can sustain is shaped by five structural pressures: rivalry among existing competitors, the threat of new entrants, the threat of substitute products or services, the bargaining power of buyers, and the bargaining power of suppliers. Its central claim is that competition is not just the firms an industry already contains but this wider set of forces, so an industry where entry is easy, substitutes are close, and buyers or suppliers hold leverage will tend to earn thinner returns than one insulated from them. Porter's 2008 Harvard Business Review restatement kept the same five forces while sharpening how each is judged. What makes the framework a landmark in strategy is its scope: it analyses an industry at the structural level rather than a single firm, and it names the specific forces an analyst examines to explain why average profitability differs across industries.[1][2][3]

Unit
A qualitative analytical framework: the five forces are assessed as strong, moderate, or weak for a defined industry rather than scored on a fixed numeric scale
Recovery means
Not applicable
Measured by
Applied by mapping a defined industry against the five forces using evidence such as concentration ratios, entry and switching costs, substitute availability, and buyer and supplier structure, then judging each force's strength

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Nearby constructs

strategy4 fields · 4 citationsjingle · one word, four constructscompetitive advantage4 names · 5 citationsjangle · one edge, rival explanations

References

  1. Porter, M. E. (1979). How competitive forces shape strategy. Harvard Business Review, 57(2), 137–145.
  2. Porter, M. E. (1980). Competitive strategy: Techniques for analyzing industries and competitors. Free Press.
  3. Porter, M. E. (2008). The five competitive forces that shape strategy. Harvard Business Review, 86(1), 78–93.

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